Although economists surveyed by The Wall Street Journal had expected new single-family home sales to reach a pace of 450,000 in December, the Commerce Department reported Tuesday that sales increased 11.6% from a month earlier to a seasonally adjusted annual rate of 481,000.
New-home sales rose to their highest level since June of 2008, finishing the year on a strong note and suggesting renewed momentum for the sector.
Adding to the brighter picture, figures for October and November were revised up by a combined 11,000.
“On the whole, the combination of lower mortgage rates and solid labor market activity appear to have ignited a meaningful pick-up in sales activity,” Millan Mulraine, deputy head of U.S. research and strategy at TD Securities, said in a note to clients.
December was warmer than usual across the continental U.S., possibly contributing to the uptick. But mortgage rates have been heading lower, employers are adding jobs at the fastest clip since before the recession and consumers appear confident, factors which may continue to support the sector.
